Office of the Attorney General
State of Texas

Re: Authority of a commissioners court to designate an agent to
invest county funds (RQ-227)

Dear Representative Hury:

You have requested our opinion on a number of questions involving
the investment of county funds. You first ask whether the
commissioners court may remove the county treasurer from the
investment process

Section 116.112 of the Local Government Code provides:

(a) The commissioners court may direct the county treasurer to
withdraw any county funds deposited in a county depository that
are not immediately required to pay obligations of the county and
invest those funds as provided by this section unless such an
investment or withdrawal is prohibited by law or the withdrawal
is contrary to the terms of the depository contract.

(b) The funds may be invested in accordance with tbe Public Funds
Investment Act of 1987 (Article 842a-2, Vernon's Texas Civil
Statutes) In addition to the obligations, certificates, and
agreements described by that Act, the funds may be invested in
certificates of deposit issued by a state or federal savings and
loan association domiciled in this state, the payment of which is
insured in full by the Federal Savings and Loan Insurance
Corporation or its successor.

Section 116.112 contemplates the involvement of two entities in
the investment process: the
commissioners court and the county treasurer. The role of the
commissioners court is discretionary:
the court determines the amount of funds which shall be invested
and the type of investment. This role is
consistant with thc courts general authority over county funds.
The commissioners court is
charged, for example, with the duty of designating which county
funds shall be demand
deposits and which shall be time deposits, and it iS empowered
to "contract with a depository for interest on time deposits"
Local Gov't Code Sect. 116.111

By contrast, the treasure's role under section 116.112 is
ministerial in character: the treasurer carries out the
directives of the commissioners court. This function is also
consistant with the treasurer's other duties Section 113.001 of
the Local Government Code declares that "the county treasurer,
as chief custodian of county funds, shall keep in a designated
depository and shall account for all money belonging to the
county." Section 113.003 provides that "the county treasurer
shall recieve all money belonging to the county from whatever
source it may be derived." The treasurer is required to disburse
money belonging to the county, which he must pay and apply as
required by law and as the commissioners court may direct. Id.
Sect. 113.041(a). The treasurer is also directed to endorse
checks or warrants drawn on the county treasurer by a proper
authority. Id. Sect. 113.042(a) The treasurer may not however,
make a payment if he "doubts the legality or propriety of an
order, decree, certificate, or warrant presented to the
treasurer for payment." Id. Sect. 113.041(d). In such cases,
the treasurer must report the matter to the commissioners court
for further direction. Each of these responsibilties in
essentially ministerial in character.

Section 116.112 does not define the term "invest." It is clear,
however, that, when read together with the other provisions of
chapters 113 and 116, the statute envisions an investment process
comprising a mix of discretionary and ministerial acts. Section
116.112(a) authorizes a commissioners court to "direct the county
treasurer" to "invest" county funds. No references is made to any
other officer or employee. Furthermore, under the terms of
chapter 113, the treasurer is the "chief" custodian of county
funds, and has the responsibility of disbursing and accounting
for them. We believe that the cited provisions of the Local
Government Code confer on the county treasurer the ministerial
functions associated with the investment of county funds, and
on the commissioners court the discretionary authority to direct
the investment process.

Another statute, article 4413(34c), V.T.C.S., enacted in 1979 is
applicable to a variety of state agencies and political
subdivisions. It addresscs, inter alia, the investment, deposit,
withdrawal transfer, and management of county funds. "Local
funds" is defined in that statute as

public funds in the custody of a state agency or political
subdivision that are not required by law to be deposited in the
stale treasury and that the agency or subdivision has legal
authority to invest.

V.T.C.S. art. 4413(34c), Sect. 1(1). "Political subdivision" is
defined as "a county, incorporated city or town, or special
purpose district." Id. Sect. 1(3). The statute further
provides, in pertinent part:

Sec. 2(a) Each state agency or political subdivision shall adopt
rules governing the investment of local funds of the agency or
subdivision. The rules shall clearly specify the scope of
authority of officers and employees of the agency or subdivision
that are designated to invest the local funds.

(b) A political subdivision may designate an officer or employee
of a public funds investment pool created under The Interlocal
Cooperation Act (Article 4413(32c), Vernon's Texas Civil
Statutes as the investment officer with responsibility for
local funds investment. An officer or employee of a commission
created pursuant to Chapter 391, Local Government Code [Regional
Planning Commission], is not eligible to be designated under this
section.

Sec 3 (a) If an officer is not assigned the function by law, a
state agency or political subdivision by rule, order, ordinance,
or resolution shall designate one or more officers or employees
of thc agency, subdivision, or public funds investment pool to be
responsible for the investment of local funds.

(b) No person amy deposit, withdraw, invest, transfer, or
otherwise manage local funds of a state agency or political
subdivision that are eligible for investment without express
written authority of the governing body or chief executive
officer of the agency or subdivision.

Since chapters 113 and 116 of the Local Government Code deal only
with county investments, while article 4413(34C), V.'l'.C.S.,
addresses the subject of investment by a variety of state
agencies and political subdivisions, the provisions of the Local
Government Code constitute the more specific statues. Although,
in a direct conflict, a specific statute controls over one which
is more general, it is also the case that statutes dealing with
the same subject matter should be contrued together and, if
possible, harmonized. Trimmier v. Carlton, 296 S.W. 1070 (Tex.
1927). We believe that article 4413(34c) may be read in harmony
with chapters 113 and 116 of the Local Government Code. Nothing
in article 4413(34c) would permit the commissioners court to
entirely remove the county treasurer from the investment
process. While the ultimate responsibility for designating the
type and amount of investment, under the terms of section
116.112(a), lies with the commissioners court, the court, in
effecting the investment, may act only through the agency of the
treasurer.

Article 4413(34C) does, however, appear to allow the
commissioners court to, delegate its own role in the investment
process. The general rule is that absent an enabling statute, a
commissioiners court may not delegate powers that invole the
exercise of judgment of discretion. Guerra c. Rodriguea, 239
S.W.2d 915 (Tex. Civ. App. --San Antonio 1951, no writ). The
court may, however, appoint an agent to make a contract on hehalf
of the county for, inter alia, "any... purpose authorized by
law." Local Gov't Code 262.001(a)(3). Under section 3(a) of
article 4413(34c), the commissioners court may "designate one or
more officers or employees... [as] responsible for the investment
of local funds." The court is required to "adopt rules" which
"shall clearly specify the scope of authority of those persons
"that are designated to invest the local funds." V.T.C.S. art.
4413(34c), 2(a). Furthermore, no individual may direct such
investment "without express written authority" of the
commissioners court. Id. Sect. 3(b). Thus, so long as it
conforms to the guidelines set forth in artitle 4413(34c), a
commissioners court may appoint an investment officer or employee
to perform its function of directing the county treasurer to make
investments. 2 Sine commissioners are also "officers" of the
county, the court may delegate to one, two or three of its
members sole discretion in making daily investment decisions and
issuing directives to the county treasurer.

SUMMARY

A commissioners court may not remove a county treasurer entirely
from the process of investing county funds, but it may designate
which funds are in accordance with the Public Funds Investment
Act, article 842a-2, V.T.C.S. A commissioners court may, by
express written authority, delegate its designative and directive
functions to another county officer or employee, including one or
more individual commissioners.

Very truly yours,

DAN MORALES
Attorney General of Texas

WILL PRYOR
First Assistant Attorney General

MARY KELLER
Deputy Assistant Attorney General

JUDGE ZOLLIE STEAKLEY (Ret)
Special Assistant Attorney General

RENEA HICKS
Special Assistant Attorney General

MADELEINE B. JOHNSON
Chair, Opinion Committee

Prepared by Rick Gilpin
Assistant Attorney General

Footnotes

Footnote 1. The office of county treasurer has been abolished in
a number fo counties specifically Tarrant, Bee, Bexar, Collins,
Andrews, Gregg, El Paso, Fayette, and Nueces. See Tex. Const.
art. XVI, Sect. 44. Since it is a constitutional office, it may
not be abolished by statute. Moncrief v. Gurley, 609 S.W. 2d.
863,865 (Tex, Civ. App.--Fort Worth 1980, writ ref'd n.r.e.).

Footnote 2. Article 4413(34c) would seem to permit the
commissioners court to delegate its investment functions to the
county treasurer, since that individual is a "county officer."